So, rolling the dice on losing 80% of sales isn’t a realistic option-at least for retail fueling locations that want to stay in business. Cards are used for approximately 80% of payments at the pump, or more than 30 million times every day. Both Visa and Mastercard say that if there isn’t a hold placed on the consumer’s bank account, the retailer might not get paid. If the banks guaranteed that the gas station would get paid, holds wouldn’t be an issue at the pump. The second charge is the “hold,” which is required to make sure you have money to cover the transaction. Its purpose is to make sure that the card being used is a valid one. This charge isn’t permanent and is later removed. One is an “authorization” charge, typically for $1. There are two charges that hit your account when you purchase gas. It’s increasingly rare to find a hotel or car rental service company that accepts debit cards at check-in because holds can be $500 or more. Holds also are placed when you check in at a hotel or rent a car. Holds are placed on both credit and debit cards, but because at times people have low balances in their bank accounts, holds on debit cards can have significant ramifications. Holds are intended to represent the largest possible fill-up that could occur, and because of higher gas prices, Visa and Mastercard upped the holds to $175 in April 2022, which became the de facto standard at most retail stations in June. One situation where that applies is at the pump. Holds are placed on card purchases when the final amount of the purchase is unknown at the time of card authorization. It’s the same process at most other retail outlets, whether you are paying for a meal, clothes or some other item either in a store or online.īut there are exceptions. At the grocery store, a customer pays after all items have been scanned and bagged. In most retail circumstances, the payment amount is known at the time of checkout. The answer is obvious, but first let’s go through a bit more detail on why holds exist. Let’s start by addressing the most important question: Who is responsible for the hold? Is it the banking and credit card industry, which has your money and writes and polices the hundreds of pages of rules that dictate credit and debit card usage without much government oversight? Or is it the retailer? As the coverage has amped up, so has the misinformation. These temporary holds of up to $175 (previously $125) are placed on a customer’s bank account when they purchase fuel, regardless of the amount of the fill-up. Debit card holds placed on fuel purchases are back in the news.
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